You now own 84 shares of XYZ stock, which is selling for $40 each, 4 of which you just received from the XYZ corporation.XYZ has declared a:
A)stock dividend of 5%.
B)cash dividend of $4.
C)stock dividend of 4%.
D)cash dividend of $160.

Question

Quizplus · Accepted Answer

XYZ has declared a stock dividend of 5%. This means that for every 100 shares of XYZ stock that you own, you will receive 5 additional shares. Since you own 84 shares of XYZ stock, you will receive 4 additional shares (84 shares x 5% = 4.2 shares, rounded down to 4 shares).

You Now Own 84 Shares of XYZ Stock, Which Is